June 7, 2005

Mail Stop 03-05

Via US Mail and Facsimile

Mr. Robert R. Falconi
President and Chief Operating Officer
748 Miller Drive, S.E.
Leesburg, Virginia 20175

Re:	Precision Auto Care, Inc.
	Form 10-KSB for the fiscal year ended June 30, 2004
Form 10-Q for the quarter ended September 30, 2004, December 31,
2004
and March 31, 2005
	Commission file #: 000-29478

Dear Mr. Falconi:

We have reviewed your May 12, 2005 response letter and have the
following comments.  Please file an amended Form 10-K in response
to
our request for expanded or revised disclosure.  If you disagree,
we
will consider your explanation as to why our comments are
inapplicable or a revision is unnecessary.  We also ask you to
provide us with supplemental information so we may better
understand
your disclosure.  Please be as detailed as necessary in your
explanation.  We look forward to working with you in these
respects
and welcome any questions you may have about any aspects of our
review.


* * * * * * * * * * * * * * * * * * * * * * *

Form 10-KSB for the year ended June 30, 2004

Note 7.  Debt Restructuring

We note from your response to comment 2 that you will revise your
financial statements to reflect the gain on the transaction as an
equity transaction.  Please file your amended Form 10-KSB for our
review as soon as possible.  Additionally, as requested in our
prior
comment, please clarify how the $10.36/share "fair value" per
share
for the 500,000 shares of redeemable preferred stock was
calculated
or determined as part of the negotiation to restructure the debt.
We
may have further comment upon receipt of your response.



Form 10-Q for the period ended December 31, 2004

Note 3. Master License Agreement

We note your revised disclosure language in response to comment 4,
however it is unclear how certain of the amounts were determined.
Please tell us and revise your disclosure to explain why only
$130,000 of revenue was recognized through December 31, 2004 when
$150,000 was paid by August 31, 2004 and explain when the $20,000
deferred revenue will be recognized.  Additionally, please clarify
the purpose of the two additional payments of $50,000 and indicate
when they are expected to be received.


* * * * * * * * * * * * * * * * * * * * * * *

As appropriate, please respond to these comments within 10
business
days or tell us when you will provide us with a response.  Please
furnish a cover letter that keys your responses to our comments
and
provides any requested supplemental information.

You may contact Claire Lamoureux at 202-551-3301 or me at 202-551-
3813 if you have questions.
								Sincerely,



								Linda Cvrkel
								Branch Chief
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Precision Auto Care, Inc.
June 7, 2005
Page 1